thinkorswim<\/a> provides three important features that allow you to backtest and experiment with trading strategies using the historical price data:<\/p>\n\n\n\n We will guide you through the functionality of each feature so you can create your own profitable trading strategies.<\/p>\n\n\n\n You can find the thinkBack<\/a> feature under the Analyze tab. The tool allows you to simulate the profit and loss of single or multiple trades entered at a certain point of time in the past using historical data.<\/p>\n\n\n\n You can choose the starting date of your backtesting using the calendar in the top right corner.<\/p>\n\n\n\n Let\u2019s go back to the week immediately after the flash crash on March 27, 2020.<\/p>\n\n\n\n The SPY has dropped from the height of $339 to $218, then rebounded to $258. There are a lot of high-quality and extremely undervalued stocks available at that time.<\/p>\n\n\n\n We can simulate the profit and loss of different bullish strategies since the crash. Here is a list of strategies that we can test:<\/p>\n\n\n\n After entering all trades, we can change the P\/L Date for the Backtrades to see the impact of our trades. In this example, let\u2019s move the P\/L Date to November 15, 2021.<\/p>\n\n\n\n The thinkBack feature shows that our simulated trades on March 27, 2020, resulted in a profit of $72,552.80, with the long FB Call<\/a> making the greatest gains.<\/p>\n\n\n\n thinkOnDemand<\/a> takes one step further than thinkBack by allowing you to perform paper trading on a virtual $100,000 account using historical data, with the following features:<\/p>\n\n\n\n Clicking on the OnDemand button in the top right corner switches to a virtual account. Then you can use the controls to select a date in the past or fast forward and backwards in time.<\/p>\n\n\n\n There are some tips to get the most out of thinkOnDemand:<\/p>\n\n\n\n While thinkBack and thinkOnDemand go back in time to test trades, we can use Strategies to simulate entry and exit points over time.<\/p>\n\n\n\n thinkorswim provides a comprehensive list of standard Studies and Strategies<\/a> to choose from, we will show you how to build your own custom Studies to find a trading system.<\/p>\n\n\n\n Studies and Strategies are saved within thinkorswim in a Study Set. By understanding how Study Set works, you can customise Study Sets for trading forex<\/a>, stocks, futures<\/a> or options<\/a>, each encompassing different indicators and chart settings.<\/p>\n\n\n\n Studies are great for chart analysis and technical indicators<\/a>, while Strategies work best for backtesting.<\/p>\n\n\n\n Let\u2019s start by creating a new Study Set called Backtesting_Strategies from Studies > Save Study Set.<\/p>\n\n\n\n Let's try a simple trading system that has entry and exit points at crossovers of 20 and 50 Exponential Moving Averages (EMA), and test it over 10 years on AAPL\u2019s daily chart.<\/p>\n\n\n\n We access the Studies and load the Study Set, Backtesting_Strategies, then Edit Studies.<\/p>\n\n\n\n We use the predefined moving average crossover strategy called MovAvgTwoLineStrat that we add to our Study Set.<\/p>\n\n\n\n Once we see all the short and long entries on the chart, we can right mouse click on the MovAvgTwoLinesStrat and select Show report to see the trade log and performance of the system.<\/p>\n\n\n\n To customise the trading strategies further, you can use the programming language, thinkScript<\/a>, to backtest any strategy you want.<\/p>\n\n\n\n Now you know the comprehensive set of backtesting tools available from thinkorswim you can use them to develop your own profitable trading systems<\/a>.\nAlternatively, you can explore Infinox broker to get started with trading<\/a>.<\/p>\n\n\n\n\n
Use thinkBack to Turn Back Time and Replay Different Trades<\/h2>\n\n\n\n
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<\/a><\/figure>\n\n\n\nthinkOnDemand act\u00faa como una m\u00e1quina del tiempo para una cuenta virtual<\/h2>\n\n\n\n
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Use Custom Strategies to Simulate Trade Performance<\/h2>\n\n\n\n
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